EFFECT OF VALUE ADDED TAX VAT

THE EFFECT OF VALUE ADDED TAX ON THE NIGERIA TAX SYSTEM

ABSTRACT

This research work aims at evaluating the effect of value added tax on the Nigeria tax system. This examines the role played by the Value Added Tax as one of the source of government's revenue. It also assesses the fact whether it has achieved the essence of its introduction. In this research doctrinal method of research was adopted in discussing the subject matter. This work delved into the legal framework of value added tax in Nigeria. The institutional structures for the administration of Value Added Tax were analysed with the aim to assessing their efficacy in revenue generation. It also took a cursory look at the assessment procedure of Value Added Tax. It was discovered in the course of the research that the law in Nigeria on VAT is faced with the problem of absolute tax practices, whereby taxes overlap, so that a single transaction may be subjected to a series of taxes e.g VAT on imported goods and Excise and Custom duty. The work found out that the punitive measures under the taxing law is not for deterrence but aimed at extinguishing small scale enterprises. The work recommended that the National Assembly should review the punishments in the Value Added Tax Act to accommodate it basic reasons which are reformation and deterrence. The punitive measures should aim at reforming the vatable persons to ensure voluntary tax compliance than pushing them out of the business. This work shall be of immense benefit to students of law, legal practitioners, legislators, academia and judges.